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Defamation, privacy breaches and misrepresentation claims: the perils of giving job references in NSW

You apply for a job you really want, but don't get it. 

Later you find out that the person you nominated to act as a referee gave you a bad reference, and that was the reason you missed out on the job.

Referees are meant to give a prospective employer an honest appraisal of an applicant's work ability, suitability for the job and their character. You asked that person to act as a referee because you trusted them to give you a good reference.

But what if the referee, for some reason, decided to sabotage your chance of getting the job?
If a referee is lukewarm about a person's ability for the job, they will mostly damn with faint praise, using words such as adequate, okay or a safe hand.

However, a referee might really rubbish you, declaring you to be incompetent, lazy, lacked punctuality, was unreliable or untrustworthy. It could destroy your career. What can you do about it? Can you sue for defamation?

NSW defamation law and the defence of qualified privilege

It may come as a surprise, but the person giving a reference for a job is protected under common law as having "qualified privilege". (See section 30 of the Defamation Act 2005.)

It dates back centuries to the old English class system of masters writing references for servants. A servant couldn't get a job without a good reference, so the master literally held their underlings' fate in their hands.

It might be that a servant had refused a master's sexual advances. Perhaps the servant had had an affair with a member of the master's family. There was no way British law was going to allow servants to sue their masters for bad or unfair references, and that was largely inherited in Australian law.

Exceptions to rule of qualified privilege where referee has acted with malice

However, in NSW law there are exceptions to the rule of qualified privilege. A plaintiff can sue for defamation if they can show that the referee acted with malice. To be accepted as malice, the statement has to be false in fact and injurious to the person's character.

If a plaintiff can demonstrate that the referee acted out of spite or vengeance for something that happened, they may have a case for defamation. But the plaintiff has to prove that the referee acted out of malice, and that might not be easy.

Bad references and social media

Your reputation might be damaged if a bad reference is passed on to anyone beyond the prospective employer who requested it. In this situation, the referee's privileged status might no longer apply, but it would depend on how the damaging reference was spread to others.

If a bad reference is leaked on social media, the victim might have a case under defamation law. But it would have to come under the limits of what amounts to defamation – that if someone heard the false information they would think less of you. It would have to overcome the defence that it was a valid opinion.

Stick to the facts and be honest if you are the referee

If you are writing a reference for someone you are not too keen on, it would be advisable to stick to generalities, limit comments on personal matters to employment facts and allow a prospective employer to phone you for details, but be wary of breaching privacy rules.

It is also possible that if a referee withholds needed information about a person applying for a job, such as criminal activity in the workplace or a history of harassment or bullying, it might also open the referee to a claim of misrepresentation from the company which hired the person on the basis of the reference, with the potential of seeking damages.

Originally published at http://www.mondaq.com/article.asp?articleid=594048&email_access=on&chk=1847832&q=1253784

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